The Retail Business, COVID-19, and The Dark Stores

What is a dark store?

We all know what is the brick & mortar Store but what is a dark store? In simple terms, dark stores are traditional retail stores that have been converted to local fulfillment centers. Traditionally, grocery stores were the leaders in that area, but the concept can be extended to all product retailers, including fashion, beauty products, fragrances, home furnishings or electronics.

What happened in the early days of COVID-19?

With the COVID-19 pandemic, retailers had to completely shut down their retail stores and ended up with a lot of physical space housing a lot of products that they were unable to sell.

Businesses that did not have e-commerce presence, rushed to establish their e-commerce sites only to realize that it is not a simple, cheap, and quick endeavor. Those who already had e-commerce capability, soon ran into the delivery logistics nightmare which resulted in frustrating delays and much-longer-than-usual order times, similar to what Amazon has experienced worldwide.

On the other hand, some agile brands just switched their physical stores in city centers and malls to dark stores serving their neighborhoods, in order to shorten delivery times and provide a faster and more convenient shopping experience.

The rise of the hybrid store

Though Dark Stores were a necessary move during the lockdown period of the pandemic, they will not be the right solution going forward after lockdown restrictions get lifted.

On one hand we acknowledge that consumers who have experienced, for months now, home delivery, curbside pickup, and online shopping; would very likely continue doing that to a certain extent after the COVID-19 dust settles. On the other hand, we also acknowledge that consumers still value the tangible experience that comes with being able to interact with and purchase items in store.

Brick & Mortar stores have to quickly evolve to becoming hybrid stores or what we call true omni-channel stores, in order to make more efficient use of their expensive physical space and their staff. They will continue to serve partly as dark stores for their neighborhood while serving a certain number of walk-in customers at a time, respecting the social distancing rules.

Efficient technology solutions needed 

With the right out-of-the box technology solutions and proper customer data,  omni-channel stores can become a reality without adding a lot of stress on the brand team. By leveraging the proper communication channels like WhatsApp along with automation and easy access to customers microsites, a business can continue to provide great customer experience (including ‘click and collect’ or ‘buy online and pickup in store’) and generate needed traffic and revenues during these tough times.

To learn more how UrbanBuz can help you turn you retail store into a hybrid dark store through our AI powered customer journey platform, click HERE.

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Clienteling App for Retail? Is It Another Fad?

Do you remember shopping at your local neighborhood boutique? When the owner knew you by name, asked about your family and remembered what you bought the last time you visited? Helped you pick out something for your special occasion?

It is not enough to provide such GREAT feel online, the reality is that in-store remains a core focus for retail and will be for a long time as 85% of customers still prefer to shop in-store.

According to Boston Retail Partners, 63% of retailers are currently unable to identify their customers prior to checkout, while 20% can’t identify them until after checkout or not at all. Without being able to identify their customers, how can a retailer give the personalized service that customers still crave but has been lost?

Introducing the Clienteling app that puts personalization and GREAT feel back into in-store shopping — What if you could walk into a store now and staff greets you by name despite which mall or even country you are in? If they knew when and which channel you last visited and what you bought, your preferences and taste and can easily recommend products you may like.

“A Customizable Clienteling App gives your store staff real-time access to relevant customer information to create memorable experiences at the store”

In the current super competitive environment, such clienteling apps are no longer nice to have, they are a must have especially in the luxury and premium retailing industry. The level of information provided through the clienteling apps creates better informed in-store staff that can then upsell, offer alternatives if an item is out of stock or just use the data to make more relevant and personal recommendations. Immediate benefits include:

  • Increased customer engagement
  • Increased customer lifetime value
  • Enhanced customer in-store experience
  • Insightful customer data that will help marketers to improve their ROI and product development

But the biggest benefit of all is recreating the GREAT feel of local stores, which in turn boosts loyalty and therefore revenue. In 2017 a BCG survey found that by strengthening customer relationships through data-driven personalization can increase revenue by 6-8%.

So, what are you waiting for? To see how clienteling apps can benefit you and your customers, please request a demo here.

 

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